A prop firm, or proprietary trading firm, is a company that provides traders with access to the firm’s capital to trade financial markets such as forex, stocks, commodities, or cryptocurrencies. Traders typically undergo an evaluation or trading challenge to demonstrate their skills, discipline, and risk management abilities. Once approved, they receive a funded account and share a portion of the profits with the firm while following specific trading rules, such as maximum drawdowns or daily loss limits. Prop firms allow skilled traders to leverage larger capital without risking their own money, offering opportunities for profit, professional growth, and access to resources and mentorship.